NRI Will: Why You Need a Separate Will for Your Indian Assets

A Non-Resident Indian (NRI) refers to an individual who is of Indian origin or a citizen of India but does not reside in India permanently as mandated by the Income Tax Act 1961 and the Foreign Exchange Management Act 1999.

More than 20 lakh Indians emigrate abroad every year. Although it is essential for all to make a Will, for NRIs it is even more vital since they could have several properties in various nations. In case an NRI passes away intestate, his or her family and loved ones may never realize what property and financial assets he or she possesses in India. Therefore, a Will is a repository of all your asset information and ensures your estate is passed on to your selected Beneficiaries.

Will-Making Essentials For NRIs

Much to the contrary of popular perception, the essentials for NRIs who wish to make a Will for their Indian assets are extremely minimal. The individual must be a major (above 18 years), of sound mind and should execute the Will with free consent, ie, without any pressure or undue influence. The Will must be written, signed by the Testator (author of the Will) and witnessed by two reliable Witnesses. The Testator must also specify an Executor and distinctly indicate the property to be given away, together with the details of the respective Beneficiaries on whom the property will devolve.

Estate planning does not have to be a laborious and painstaking exercise, particularly for NRIs who might lack familiarity with the many personal, local and national laws covering succession and inheritance in India, but failing to do so causes family to stumble through the tiresome and long process of intestate succession. Without a Will, families who are not located in India, will often need to travel to obtain a succession certificate or letter of administration from the courts, in order to establish the relationship between the deceased and their heirs.

This requires the submission of the deceased NRI’s and legal heirs’ official documents, like birth and death certificates, identification documents, details of assets and other credentials. The procedure of procuring a succession certificate or letter of administration, can very well extend beyond six months, subject to no one raising an objection to the same. If anyone raises an objection or challenges the grant of the succession certificate, the matter can be hung up in court for even longer and in that case, it will be years before the deceased’s assets can be accessed by the heirs.

Nuances Of Succession Laws

Succession laws differ from one country to another and are based upon considerations such as where the deceased was residing, where his / her immovable and movable properties were and whether there is any obligatory inheritance law (such as forced heirship or community property legislation) in the domicile country where the individual has now established a permanent residence.

According to the common principles of domicile, in case of immovable properties within a country, succession laws of the country where the properties are would have to be adhered to. Movable properties can be inherited as per the succession laws of the country where the NRI resides at the time of his death.

A good example to take into consideration here is the case of UAE. Since 2017, UAE has provided its non-Muslim expatriates the choice to prepare a DIFC (Dubai International Financial Centre) Will. A DIFC Will allows such expats to choose a temporary or permanent Guardian for minor kids living in the UAE, determine division of their UAE and global assets, registration of the Will, etc. Without a DIFC Will, inheritance will go under the Sharia law.

Should an NRI prepare a separate Indian Will?

While it is legally acceptable for an NRI to prepare a single composite multi-jurisdictional Will covering all movable and immovable properties in various countries, it is a common practice to prepare a separate Will for your Indian assets. Independent Will also makes the process of execution faster because your loved ones will not unnecessarily have to wait for the legal process to conclude in your home country before proceeding can be lodged in other nations to validate the Will. Additionally, independent Wills can completely do away with the requirement of validating the offshore Will, hence accelerating the process of transferring assets.

Will-Making Tips For NRIs

A large number of people feel that by appointing a Nominee to their bank accounts and investments, they have taken sufficient care, but a Nominee is just a Trustee of your properties and not a legal heir as such. Having a Will pre-empts any kind of complexity between Nominees and legal heirs under the laws of succession.

To ensure that your Will is legally valid, have it drafted by professionals who are well-versed with the succession laws that apply to you.

Revisit your Will every year or two, so that you don’t miss updating any changes in your list of assets. It’s also a good idea to make sure your chosen Executor is still willing to take on his/her responsibility.

Avoid using vague language; have your Will clearly and well-worded so that everyone can read it and understand.

While selecting an Executor, select an Executor younger than you, who is reliable and also lives in the same locality, so follow-up procedures would be easy. If there are several Wills, then select a different Executor for each Will.

While making a Will, consider foreign exchange rules for NRI Beneficiaries.

Leave your original Will in a safe location. Let your Executor know where the original Will is and, if convenient, give them a copy.

NRIs are not required to be physically present in India to make a legally binding Will. As stated earlier, you have to only ensure that you are above 18 years of age and of sound mind, when you sign the document in front of two Witnesses.

While India doesn’t require Wills to be registered, an easy-to-use registered Will provides for smoother facilitation of establishing its legality and validity of the Will, if challenged at some point in the future in court. Yellow makes it easy and convenient to arrange NRI Will registration in India or may assist you through the registration at an Indian consulate in your native country.

Always keep in mind, it is your prerogative to have your wealth divided according to your wish. But this right goes unutilized by the majority when they pass away intestate or leave behind an invalid Will. Relatives and loved ones are the worst hit, as the process of inheriting the wealth of a deceased relative is not only emotionally taxing, but can also prove to be a costly and time-consuming exercise.

 In certain instances, the case prolongs for so long that the family members, particularly NRIs, may be compelled to abandon the process incomplete or unattended. NRIs also travel to India for a short duration and may not be aware of the prevailing laws, which further complicates the process of making a Will.

You can save all the trouble by approaching a professional expert in estate planning services, such as Yellow.

Our legal professionals have 50+ years of experience in estate planning and have, so far, safeguarded over Rs 42,000 crores of assets for Indian families. Being an NRI with assets in India, it is essential that you plan ahead. Our estate planning professionals can give you all the advice and guidance needed for a hassle-free transfer of all your assets to your heirs.

Frequently Asked Questions on Online Will Making for NRI

Q1. Why is making a will important for NRIs?

Ans1. NRIs often own assets in multiple countries. A will ensures their estate is distributed as per their wishes, preventing legal complications for heirs.

Q2. Can an NRI make a will without being physically present in India?

Ans2. Yes, an NRI can create a legally valid will from abroad by signing it in front of two witnesses. Registration at an Indian consulate can further strengthen its validity.

Q3. Should NRIs create a separate will for Indian assets?

Ans3. Yes, having a separate will for Indian assets simplifies execution, avoiding delays due to multi-jurisdictional legal processes.

Q4. What happens if an NRI dies without a will?

Ans4. If an NRI passes away intestate, their assets in India are distributed based on Indian succession laws, which may not align with their wishes.

Q5. How do succession laws affect an NRI’s estate?

Ans5. Immovable property is governed by Indian succession laws, while movable assets are inherited as per the laws of the country where the NRI resided at the time of death.

Q6. Can an NRI’s will be challenged in court?

Ans6. Yes, a will can be contested based on claims of undue influence, improper execution or lack of testamentary capacity.

Q7. Does appointing a nominee replace the need for a will?

Ans7. No, a nominee is only a trustee of assets, not the legal heir. A will is necessary to ensure rightful inheritance.

Q8. What is the role of an executor in an NRI will?

Ans8. An executor manages asset distribution as per the will. Choosing a younger, reliable person ensures smooth execution.

Q9. Can an NRI register their will?

Ans9. While will registration is not mandatory in India, registering it can strengthen its legal validity and prevent future disputes.

Q10. How can an NRI ensure a hassle-free estate transfer?

Ans10. Seeking professional legal assistance ensures the will is correctly drafted, legally sound and executed without unnecessary delays.